<<< back to article list

Title Insurance


Blog by Marites Kliem PREC* | April 24th, 2009


What does Title Insurance cover?
A title defect arises in a number of ways, but the defect that causes the most concern is real estate fraud. British Columbia has perhaps the most efficient land title system in the world (a “Torrens” system) but there are an increasing number of situations where fraud is committed. This can happen in a variety of ways.

With identity theft on the rise, it is not difficult for a fraudster to obtain legitimate identification claiming to be the true owner. The fraudster then deals with realtors and lawyers as if they were the owner, and proceeds to sell the property. Since the fraudster has legitimate identification, the realtor and lawyer are unaware of the fraud.  Alternatively, the fraudster may work with a lender or mortgage broker, again with identification, to place a new mortgage on the property. In either situation, the true owner is unaware of the fraud and the fraudster absconds with the sale or mortgage funds.

Other typical examples include spousal impersonation and lawyer fraud.

In most cases the Assurance Fund of the Land Title Office may reimburse the true owner, but this may take several months and thousands of dollars in legal fees. Title Insurance may be quicker and less expensive.

In addition to protecting against title fraud, Title Insurance may cover violations of municipal by-laws, encroachments onto an adjoining property, realty tax arrears, existing work orders, lack of legal access to the property and unpaid strata assessments.

For the full article visit:

http://www.bcrealestatelawyers.com/fraud-insurance